1.According to Thomas Jefferson, "A wise and frugal government, (is one) which shall restrain men from injuring one another, which shall leave them otherwise free to regulate their own pursuits of industry and improvements, and shall not take from the mouth of labor the bread it has earned." Using words, explain what Jefferson meant.

2.Would people be better off if voting was more widely used to determine what goods should be produced and consumed? Why or why not?

3.When political officials are elected democratically, can they be counted on to pursue policies that promote the general welfare of the populace?

4.Explain how the budget situation identified in question 3 impacted the public debt figure in question 4.

In other words, what is the difference between the deficit and the debt? How are they related?

5.What is the special interest effect? What does it imply about the efficiency of how goods and services will be allocated through the political process?

6.Visit the website U.S. Debt Clock(opens new window) (plaintext link:http://www.usdebtclock.org).

What is the national debt in trillions of dollars?

7.Visit the Federal Reserve Bank of St. Louis FRED Database ( http://research.stlouisfed.org/fred2/series/FYFSD ).

Locate the latest budget figure. What is it in billions of dollars? (Note:Be sure to report the Fed's figure in billions of dollars. For example: 100,000 million = 100 billion)

What does this figure indicate about government revenues and expenditures?